A situation has come up in which an insurance policy has 2 beneficaries, each getting 50% of the policy amount. Now the deceased also had a will, which was drafted after the life policy was created I believe, that states life insurance money be split amongst 3 individuals. What it says on the will is not what it says on the life insurance. My questions are as follows:
What takes precendent over what? The will or what it says on the policy?
Is it the responsibility of the executor of the estate to split up the money accordingly to the will?
Are the 2 individuals legally obligated to give money to the 3rd individual to make up the right percentages on the will?
To make things even more complex. There might of been 2 policies out on the deceased individual. One for which the will was intended and another “lame duck/dead duck” (or whatever you call it) policy. It is believed that this policy was not known to the deceased. Because of the manner of death policy #1 would not pay out. Which is interesting because this second policy is. Or it could all be the same policy. Any answers are greatly appreciated.
Call a lawyer, but in most situations, an insurance policy and the forms related thereto (including beneficiary forms) will override a will, even if a will was executed after the insurance policy was issued. With respect to the policy that has a valid beneficiary form on file, such amounts should be paid by the insurance company outside of the probate estate to the relevant beneficiaries.
With respect to the other policy for which it sounds like no beneficiary form is outstanding, such amounts would be distributed by the insurance company as stated in the policy (usually to the estate). Once they become part of the estate, they are distributed through probate by the exeutor or administrator, but only after all debts (including taxes) have been paid.
IANAL, but I’m sure one will be here soon. First it’s going to depend on what state you live in. Second, the Executioner of the will has an obligation to inform the third party that they have been included in the will. After that happens you can be sure that the other two are going to take it to probate court.
If the named beneficiary of insurance is the estate, the executor *must * divide it three ways. If the insurance has named beneficiaries, these *are * due its benefit unless a court rules otherwise.